Collectibles have been hot this year, with new records being hit almost daily. Just this fall, an acoustic guitar owned by John Lennon of the Beatles sold for $2.41 million, crushing original estimates of $600,000 to $800,000.
From The Wizard of Oz, Dorothy’s dress sold at auction for $1.5 million.
Amedeo Modigliani’s “Reclining Nude” sold for $170 million, making it the second-highest art auction price, while Roy Lichtenstein’s “Nurse” sold for $95 million, nearly doubling the last record for the artist.
Owning a unique piece of art is more than having your hands on something rare, something that represents a piece of history. It’s also a way to diversify your wealth so that it’s not only protected but also has ample room to grow.
And you don’t have to have millions to take advantage of the collectibles market…
To help you dip a toe into the world of collectibles, I reached out to Max Hasler with Dreweatts and Bloomsbury Auctions. Max specializes in modern first-editions and 20th-century literature and manuscripts. He joined Bloomsbury Auctions in 2010 after studying for a B.A. in Literature at Royal Holloway University of London, focusing on modernism and American literature.
Dreweatts and Bloomsbury is one of the top four auctioneers in the U.K., with over 150 sales per year across a broad range of disciplines. Bloomsbury has historically specialized in book auctions, and recently joined with Stanley Gibbons in the last few years.
Jocelynn: Thanks so much for chatting with me, Max. Readers of Sovereign Investor Daily have heard me talking about collecting stamps and coins in the past as well as rare music poster art, but we’ve never touched on books before. Why are collectors willing to pay so much for books, particularly modern books?
Max Hasler: The reason people are willing to pay so much for a book is because, like other areas of the luxury collectibles market, modern first-edition books are driven by personal passions. It is this passion that usually draws people into becoming book collectors.
Part of the draw has always been aesthetic: The charm of a beautifully illustrated book, fine printing upon the page, an elaborate binding or a well-designed dust-jacket, which have been known to become as iconic as the book itself at times. Another part can be personal: For instance, you may have loved Catcher in the Rye, To Kill a Mockingbird or the works of J.R.R. Tolkien as a kid.
Jocelynn: How would you say that the market has shifted for book collectors?
Max: The reasons for possessing a book collection have altered over time; these days fewer people would own a valuable library for reference. Instead, it is about owning items of especial historical or cultural relevance or beauty.
One of the more dramatic changes to the market has happened relatively recently with the rise of the Internet. With so much information digitized, the market for reference and academic works has declined dramatically. However, in many ways it has had the opposite effect on the more collectible items. The Internet enables collectors to find the books they are searching for with relative ease, either through auctions or the numerous online bookseller sites, which in turn has made book collecting far more approachable, overall.
That brings me to the newest area of book collecting: modern first editions (generally books from the 20th century and onward). Good copies continue to make record prices today.
It is also the area that has seen the most interest from people new to book collecting, as well as those looking to invest — making this the fastest growing market in the book world.
Jumping into Collectibles as a New Investor
Jocelynn: As a new collector/investor looking to include books in his portfolio, what are some of the aspects that should be considered when purchasing a book?
Max: Some of the key areas that a new investor should consider are:
- Great modern authors: Look for a classic title written by one of the greatest authors of modern English literature (that is, literature that’s written in English, not just written by an English author).
- First editions: Search for first editions. “First editions” refer to the very first “print-run” or first time a novel was published and distributed for sale. Those print-runs are, by their nature, much smaller than later editions — and that’s what makes them so attractive to book collectors.
- Area of focus: Often it will be a particular author or book that will first get collectors started before they start to broaden out. In fact, I always advise a new collector to be focused in what they are collecting; in many ways the more focused the better. Perhaps try collecting everything by a particular author. When you have been working on that for a while, you could expand to include other writers within their social or cultural circle. If you are feeling really ambitious, you could research the writer’s inspirations and try to collect those.
Jocelynn: When considering an investment, how much should condition impact the pricing of a book?
Max: An important tip that any serious book collector should bear in mind is that condition is absolutely paramount. As a collector, you might find two copies of the same book that you are looking for to fill a hole in your collection. The price of one might be a fraction of the other and the likely reason for this is condition.
As with most collectibles, books degrade over time if not kept and handled properly, and as a result it is only those copies in good condition that fetch a premium. Purchasing a lesser copy of a book might fill a hole in a collection, but you should always look to upgrade wherever possible. The potential future returns for a book also diminish in line with the condition — books in poorer condition might go up a little over time, but it is only the copies in the best condition that ultimately see the best returns.
And keep in mind that the condition of the book itself is about 10% of the value. The real value? That flimsy piece of paper wrapped around the book: the dust jacket. Make sure that your item comes with it, because a first edition with a dust cover in fine condition has been known to fetch 10 times more than a book without it.
Jocelynn: What about author signatures? I’ve heard that with some investments, they are a hindrance rather than a help.
Max: Depending on the author, book, condition of book, inscription type and rarity, signatures can help a book’s value. They are a piece of history to be prized. For example, J.D. Salinger or Thomas Pynchon’s signatures can add weight to any collection because they are notoriously reclusive, thus their signatures are rare. Other authors change their approach to signings later on, such as J.K. Rowling, who became reticent to sign books later in her career. By doing your homework, you can determine a signature’s value. Just remember that the autograph/inscription should be verified to rule out